NAB FLAK HITS PROPOSED USER FEES

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WASHINGTON-The Clinton administration last week kicked up a storm-and likely sealed its own fate-by clumsily unveiling a couple of controversial ideas to jack up user fees for broadcasters, cellular phone services and other communications devices.

In one, the Office of Management & Budget proposed significant increases in fees for industries overseen by the Federal Communications Commission, with proceeds earmarked to help states pay for incarcerating illegal aliens. Needless to say, National Association of Broadcasters President Eddie Fritts was not pleased.

"To suggest that the way to pay for this assistance is to require broadcasters and other FCC licensees to pay higher `user fees' is nothing short of astounding," Mr. Fritts said in a letter to OMB Director Leon Panetta.

Within a couple of days, an OMB trial balloon was calling for higher user fees for FCC licensees to raise $4.8 billion over five years, according to informed industry representatives. But this time, the OMB would ticket the proceeds to offset losses in duties resulting from the General Agreement on Tariffs & Trade.

Mr. Fritts, in a second letter to Mr. Panetta, said it was "intolerable to make [broadcasters] the `bankers' for every brand new program the White House wants to create or fund."

But what really may have killed any chances that the proposal or the trial balloon might be adopted was the reaction of Rep. John Dingell (D., Mich.). As chairman of the House Energy & Commerce Committee, Rep. Dingell oversees all FCC-connected legislation, and he wasn't happy the OMB had issued its first proposal and floated a balloon on the second without informing him ahead of time.

"Leon, we have had similar regrettable experiences with OMB on other issues," the drippingly sarcastic letter concluded. "I sincerely want to avoid unnecessary differences between us. I hope that in the future, initiatives that amend statutes or affect programs falling within the jurisdiction of this committee will be brought to our attention directly, so that we will not have to rely upon the press, lobbyists or other committees to learn of the administration's intentions."

An industry lobbyist said the OMB's handling of the proposal and the trial balloon made chances of passage for either highly unlikely.

The NAB said higher user fees would be particularly harmful to emerging technologies like personal communications services and to financially marginal and smaller-market AM and FM radio stations. Higher user fees would also raise the specter of higher ad rates, the NAB said.

"You either incur the higher costs, or you pass them along to advertisers," said VP Lynn McReynolds.

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